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The U.S. tightened sanctions on Iran increased oil prices

By 23/04/2019 September 27th, 2019 No Comments

Oil and gas shares jumped up to almost 2% on Tuesday, April 23.
The reasons for such increase of the shares are sanctions those US imposed on more than 600 Iranian oil companies and private traders. The conflict between the USA and Iran lasted more than a year. The U.S. has tightened sanctions on Iran intending to forbid buying Iranian oil according to the Iran nuclear deal which was declined by the U.S. As we know, the US withdrew the Iran deal on May 2018. China, Greece, Japan, Turkey and other counties, which had permission to buy Iranian oil, don’t have such opportunity anymore.
The USA announced they would trade with Iranian enemies, Saudi Arabia and the United Arab Emirates. These sanctions may lead to a lack of oil in the oil market, so the USA is trying to prevent this problem in such a way.
Global oil and gas markets reaction
Global oil and gas markets reacted rapidly. Brent shares moved up to $75 a barrel. But the Canadian dollar and Norwegian crown dipped to $1.33 and $8.52 respectively. Robert Carnell, head of research for the Asia Pacific at ING think that Brent shares gain may have a negative effect. He said that these tight sanctions could open new perspectives for oil-producing regions.
The Russian rouble hit its highest against the euro in more than a year its highest against the dollar in a month.
Both the Canadian dollar and the crown had gained on Monday, April 22.
MSCI’s index of Asia-Pacific shares ended 0.1 per cent higher, and Japan’s Nikkei closed up 0.2 per cent. Oil and gas gains were offset by losses for airlines and other transport shares facing higher fuel costs.

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